EXHIBIT 1.2
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2,000,000 SHARES
CHANCELLOR BROADCASTING COMPANY
7% CONVERTIBLE PREFERRED STOCK
PURCHASE AGREEMENT
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January 17, 1997
Xxxxx Xxxxxx Inc.
Alex. Xxxxx & Sons Incorporated
BT Securities Corporation
Credit Suisse First Boston Corporation
Xxxxxxx, Sachs & Co.
c/o Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Chancellor Broadcasting Company (the "Company"), a Delaware
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corporation, hereby confirms its agreement with you (the "Initial
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Purchasers"), as set forth below.
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1. The Securities. Subject to the terms and conditions
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herein contained, the Company proposes to issue and sell to the
Initial Purchasers 2,000,000 shares (the "Firm Shares") of its
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Convertible Preferred Stock, par value $.01 per share (the
"Convertible Preferred Stock"). The Company also proposes to sell to
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the Initial Purchasers, upon the terms and conditions set forth in
Section 3 hereof, up to an additional 300,000 shares (the "Additional
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Shares") of Convertible Preferred Stock. The Firm Shares and the
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Additional Shares are hereinafter collectively referred to as the
"Shares."
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The Shares are to be convertible at the option of the holder
at any time after March 25, 1997, unless previously redeemed, into
Class A Common Stock, par value $.01 per share
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(the "Common Stock"), of the Company at a conversion price of $32.90
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per share of Common Stock, subject to adjustment in certain events as
described in the Certificate of Designation governing the Shares (the
"Certificate of Designation"). The Shares and the shares of Common
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Stock into which they are convertible are referred to herein
collectively as the "Securities."
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The Securities will be offered and sold to the Initial
Purchasers without being registered under the Securities Act of 1933,
as amended (the "Act"), in reliance on exemptions therefrom.
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In connection with the sale of the Securities, the Company
has prepared a preliminary offering memorandum dated January 3, 1997
(the "Preliminary Memorandum") and a final offering memorandum dated
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January 17, 1997 (the "Final Memorandum"; the Preliminary Memorandum
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and the Final Memorandum each herein being referred to as a
"Memorandum") setting forth or including a description of the terms of
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the Securities, the terms of the offering of the Securities, a
description of the Company and any material developments relating to
the Company occurring after the date of the most recent historical
financial statements included therein.
The Initial Purchasers and their direct and indirect
transferees of the Securities will be entitled to the benefits of the
Registration Rights Agreement, substantially in the form attached
hereto as Exhibit B (the "Registration Rights Agreement"), pursuant to
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which the Company has agreed, among other things, to file a shelf
registration statement (the "Shelf Registration Statement") with the
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Securities and Exchange Commission (the "Commission") registering the
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Shares and, if such Shares are subsequently converted into Common
Stock, the Common Stock under the Act.
Concurrently with the sale of the Securities, Chancellor
Radio Broadcasting Company, a wholly owned subsidiary of the Company
("Chancellor Radio Broadcasting"), (i) is offering $200 million
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liquidation preference of its 12% Exchangeable Preferred Stock (the
"Exchangeable Preferred Stock") and (ii) is entering into an amended
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and restated Credit Agreement (the "New Credit Agreement"), to be
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dated on or about the Closing Date, among Chancellor Radio
Broadcasting, Bankers Trust Company, as administrative agent and a
lender thereunder, and the other institutions party thereto, which
will provide for loans to Chancellor Radio Broadcasting of up to
$345,000,000. In
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addition, Chancellor Radio Broadcasting has entered into an agreement
to acquire eight radio stations from OmniAmerica Group (the "Omni
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Acquisition") pursuant to a purchase agreement between Chancellor
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Radio Broadcasting and OmniAmerica Group dated May 15, 1996 (the
"Omni Agreement") and has entered into an agreement to acquire twelve
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radio stations from Colfax Communications, Inc. (the "Colfax
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Acquisition") pursuant to a purchase agreement between Chancellor
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Radio Broadcasting and Colfax Communications, Inc. dated August 24,
1996 (the "Colfax Agreement"). In connection with the Omni
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Acquisition, Chancellor Radio Broadcasting (i) on June 24, 1996,
entered into an agreement (the "American Radio Agreement") with
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American Radio Systems Corporation ("American Radio") for, among other
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things, the exchange of a radio station being acquired pursuant to the
Omni Acquisition for a radio station currently owned by American Radio
(the "American Radio Transaction") and (ii) on July 1, 1996 entered
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into an agreement (the "SFX Agreement") with SFX for, among other
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things, the exchange of a radio station being acquired pursuant to the
Omni Acquisition for four radio stations currently owned by SFX (the
"SFX Transaction"). In connection with the Colfax Acquisition,
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Chancellor Radio Broadcasting entered into a letter of intent dated
December 19, 1996 (the "Milwaukee Letter of Intent") for the sale of
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the Milwaukee stations being acquired pursuant to the Colfax
Acquisition. The Colfax Acquisition will be consummated on the
Closing Date. "Chancellor Radio Broadcasting," as defined, shall
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include radio stations being acquired pursuant to the Colfax
Agreement. The transactions contemplated by this Agreement and the
New Credit Agreement, and the consummation of the Colfax Acquisition
are herein collectively referred to as the "Transactions." The Omni
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Agreement, the American Radio Agreement, the SFX Agreement and the
Milwaukee Letter of Intent are referred to herein collectively as the
"Pending Agreements."
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2. Representations and Warranties of the Company. The
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Company represents and warrants to and agrees with the Initial
Purchasers that:
(a) Neither the Preliminary Memorandum as of the date
thereof nor the Final Memorandum nor any amendment or supplement
thereto as of the date thereof and at all times subsequent thereto up
to the Closing Date (as defined in Section 3 below) contained or
contains any untrue statement of a material fact or omitted or omits
to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth
in this Section 2(a) do not apply to
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statements or omissions made in reliance upon and in conformity with
information relating to any of the Initial Purchasers furnished to
the Company in writing by the Initial Purchasers expressly for use in
the Preliminary Memorandum, the Final Memorandum or any amendment or
supplement thereto.
(b) Each of the Company and the subsidiaries of the Company
set forth on Schedule B hereto (collectively, the "Subsidiaries") has
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been duly incorporated and is validly existing and in good standing as
a corporation under the laws of its jurisdiction of incorporation,
with all requisite corporate power and authority to own or lease its
properties and conduct its businesses, as described in the Final
Memorandum, and is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions where the
ownership or leasing of its properties or the conduct of its
businesses requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the business,
condition (financial or other) or results of operations of the Company
and the Subsidiaries, taken as a whole, or on the validity or
enforceability of the Securities; immediately after the Closing Date,
the Company will have the authorized, issued and outstanding
capitalization set forth in the Final Memorandum (on the bases as are
set forth in the Final Memorandum); the outstanding shares of capital
stock of each of the Company and the Subsidiaries have been, and as of
the Closing Date will be, duly authorized and validly issued, are and
will be fully paid and nonassessable and were not and will not be
issued in violation of any preemptive or similar rights; and except as
otherwise set forth in the Final Memorandum, all of the outstanding
shares of capital stock (i) of Chancellor Radio Broadcasting,
excluding Chancellor Radio Broadcasting's existing shares of 12 1/4%
Series A Cumulative Exchangeable Preferred Stock and the Exchangeable
Preferred Stock, are, and as of the Closing Date will be, owned by the
Company and (ii) of each of the Other Subsidiaries are, and as of the
Closing Date will be, owned directly or indirectly by the Company.
Except for the stock of each of the Subsidiaries owned directly or
indirectly by the Company, and partnership interests in partnerships
owning certain of the Company's transmitter facilities, the Company
does not own, directly or indirectly, any shares of stock or any other
equity or long-term debt securities or have any equity interest in any
firm, partnership, joint venture or other entity. No holders of
securities of the Company are entitled to have such securities
registered under the registration statement required to be filed by
the Company pursuant to the Registration Rights Agreement other than
as expressly permitted thereby.
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(c) The Certificate of Designation has been duly authorized
by the Company. Prior to the Closing Date, the Shares shall have been
duly authorized and, when issued and delivered against payment
therefor in accordance with the terms hereof, will be validly issued,
fully paid and nonassessable and free of any preemptive or similar
rights; as of the Closing Date, the capital stock of the Company shall
conform, in all material respects, to the description thereof in the
Final Memorandum. The Certificate of Incorporation of the Company, by
virtue of the Certificate of Designation, sets forth the rights,
preferences and priorities of the Shares. The certificates for the
Shares that are being sold by the Company are in due and proper form
and the holders of such Shares will not be subject to personal
liability by reason of being such holders.
(d) The Shares, when issued and delivered, will be
convertible at the option of the holder thereof into shares of Common
Stock in accordance with the terms of the Certificate of Designation;
the Common Stock issuable upon such conversion has been duly
authorized and validly reserved for issuance upon such conversion by
all necessary corporate action and such Common Stock, when issued and
delivered upon such conversion, will be validly issued, fully paid and
nonassessable and free of any preemptive or similar rights.
(e) The Company has all requisite corporate power and
authority to execute and deliver the Registration Rights Agreement;
the Registration Rights Agreement has been duly authorized by the
Company and, when executed and delivered by the Company (assuming due
authorization, execution and delivery by you), will constitute a valid
and legally binding agreement of the Company enforceable against it in
accordance with its terms, except that (A) the enforcement thereof may
be subject to (i) bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought (regardless of whether such
enforcement is considered in a proceeding in equity or at law) and
(B) any rights to indemnity or contribution thereunder may be limited
by federal and state securities laws and public policy considerations.
(f) The Company has all requisite corporate power and
authority to execute and deliver this Agreement and, subsequent to the
filing of the Certificate of Designation, to issue and deliver the
Securities and to consummate the transactions
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contemplated hereby. This Agreement has been duly authorized,
executed and delivered by the Company. No consent, approval,
authorization or order of any court or governmental agency or body
(including, without limitation, the Federal Communications Commission
(the "FCC")) is required for the performance of this Agreement by the
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Company or the consummation by the Company of the transactions
contemplated hereby, except such as have been obtained and such as may
be required under state securities or "Blue Sky" laws in connection
with the purchase and resale of the Securities by the Initial
Purchasers.
(g) Neither the Company nor any of the Subsidiaries is
(i) in violation of its certificate of incorporation or by-laws,
(ii) in violation of any statute, judgment, decree, order, rule or
regulation applicable to the Company or any of the Subsidiaries, which
violation would have a material adverse effect on the business,
condition (financial or other) or results of operations of the Company
and the Subsidiaries, taken as a whole, or on the validity or
enforceability of the Securities, as the case may be, or (iii) in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, note, lease, license, franchise agreement,
permit, certificate, contract or other agreement or instrument to
which the Company or any of the Subsidiaries is a party or to which
the Company or any of the Subsidiaries is subject, which default would
have a material adverse effect on the business, condition (financial
or other) or results of operations of the Company and the
Subsidiaries, taken as a whole, or on the validity or enforceability
of the Securities, as the case may be.
(h) Neither the issuance and sale of the Securities nor the
execution, delivery and performance by the Company of this Agreement
or the Registration Rights Agreement and the consummation of the
transactions contemplated hereby and thereby will conflict with or
constitute or result in a breach or violation of any of (i) the terms
or provisions of, or constitute a default by the Company under any
indenture, mortgage, deed of trust, loan agreement, note, lease,
license, franchise agreement, or other agreement or instrument to
which the Company is a party or to which the Company or its
respective properties is subject, which conflict, breach, violation or
default would have a material adverse effect on the business,
condition (financial or other) or results of operations of the Company
or on the validity or enforceability of the Securities, as the case
may be, (ii) the certificate of incorporation or by-laws of the
Company, as the same will be in effect on the Closing Date, or
(iii) (assuming
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compliance with all applicable state securities and "Blue Sky" laws
and assuming the accuracy of the representations and warranties of the
Initial Purchasers in Section 8 hereof) any statute, judgment, decree,
order, rule or regulation of any court or governmental agency or other
body applicable to the Company or any of its respective properties,
which conflict, breach, violation or default would have a material
adverse effect on the business, condition (financial or other) or
results of operations of the Company or on the validity or
enforceability of the Securities, as the case may be.
(i) The audited consolidated financial statements and
schedules of the Company included in the Final Memorandum present
fairly, in all material respects, the consolidated financial position,
results of operations and cash flows of the Company at the dates and
for the periods to which they relate and have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis, except as otherwise stated therein. The unaudited
financial statements and the related notes included in the Final
Memorandum present fairly, in all material respects (on the basis
stated therein), the financial position, results of operations and
cash flows of the Company at the dates and for the periods to which
they relate, subject to year-end audit adjustments, and have been
prepared in accordance with generally accepted accounting principles
applied on a consistent basis, except as otherwise stated therein.
Coopers & Xxxxxxx L.L.P., which has examined certain of such
consolidated financial statements and schedules as set forth in its
reports included in the Final Memorandum, is an independent public
accounting firm within the meaning of the Act and the rules and
regulations promulgated thereunder.
(j) The audited financial statements and schedules of "Old
Chancellor Communications" (as defined in the Final Memorandum)
included in the Final Memorandum present fairly, in all material
respects, the financial position, results of operations and cash flows
of Old Chancellor Communications at the dates and for the periods to
which they relate and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, except
as otherwise stated therein. Coopers & Xxxxxxx L.L.P., which has
examined certain of such financial statements and schedules as set
forth in its reports included in the Final Memorandum, is an
independent public accounting firm within the meaning of the Act and
the rules and regulations promulgated thereunder.
(k) The audited consolidated financial statements and
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schedules of "Trefoil Communications, Inc." (as defined in the Final
Memorandum) included in the Final Memorandum present fairly, in all
material respects, the consolidated financial position, results of
operations and cash flows of Trefoil Communications, Inc. at the dates
and for the periods to which they relate and have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis, except as otherwise stated therein. Price
Waterhouse LLP, which has examined certain of such consolidated
financial statements and schedules as set forth in its reports
included in the Final Memorandum, is an independent public accounting
firm within the meaning of the Act and the rules and regulations
promulgated thereunder.
(l) The audited financial statements and schedules of
"KDWB-FM" (as defined in the Final Memorandum) included in the Final
Memorandum present fairly, in all material respects, the financial
position, results of operations and cash flows of KDWB-FM at the dates
and for the periods to which they relate and have been prepared in
accordance with generally accepted accounting principles applied on a
consistent basis, except as otherwise stated therein. The unaudited
financial statements and the related notes included in the Final
Memorandum present fairly, in all material respects (on the basis
stated therein), the financial position, results of operations and
cash flows of KDWB-FM at the dates and for the periods to which they
relate, subject to year-end audit adjustments, and have been prepared
in accordance with generally accepted accounting principles applied on
a consistent basis, except as otherwise stated therein. Coopers &
Xxxxxxx L.L.P., which has examined certain of such financial
statements and schedules as set forth in its reports included in the
Final Memorandum, is an independent public accounting firm within the
meaning of the Act and the rules and regulations promulgated
thereunder.
(m) The audited combined financial statements and schedules
of Colfax included in the Final Memorandum present fairly, in all
material respects, the financial position, results of operations and
cash flows of Colfax at the dates and for the periods to which they
relate and have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis, except as
otherwise stated therein. The unaudited combined financial statements
and the related notes included in the Final Memorandum present fairly,
in all material respects (on the basis stated therein), the financial
position, results of operations and cash flows of Colfax at the dates
and for the periods to which they relate, subject to year-end audit
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adjustments, and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, except
as otherwise stated therein. Xxxxxx Xxxxxxxx LLP, which has examined
certain of such financial statements and schedules as set forth in its
reports included in the Final Memorandum, is an independent public
accounting firm within the meaning of the Act and the rules and
regulations promulgated thereunder.
(n) The audited combined financial statements and schedules
of the "Sundance Stations" (as defined in the Final Memorandum)
included in the Final Memorandum present fairly, in all material
respects, the financial position, results of operations and cash flows
of the Sundance Stations at the dates and for the periods to which
they relate and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, except
as otherwise stated therein. The unaudited combined financial
statements and the related notes included in the Final Memorandum
present fairly, in all material respects (on the basis stated
therein), the financial position, results of operations and cash flows
of the Sundance Stations at the dates and for the periods to which
they relate, subject to year-end audit adjustments, and have been
prepared in accordance with generally accepted accounting principles
applied on a consistent basis, except as otherwise stated therein.
Coopers & Xxxxxxx L.L.P., which has examined certain of such financial
statements and schedules as set forth in its reports included in the
Final Memorandum, is an independent public accounting firm within the
meaning of the Act and the rules and regulations promulgated
thereunder.
(o) The audited combined financial statements and schedules
of the Omni Corporations included in the Final Memorandum present
fairly, in all material respects, the financial position, results of
operations and cash flows of Omni at the dates and for the periods to
which they relate and have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis, except
as otherwise stated therein. Coopers & Xxxxxxx L.L.P., which has
examined certain of such financial statements and schedules as set
forth in its reports included in the Final Memorandum, is an
independent public accounting firm within the meaning of the Act and
the rules and regulations promulgated thereunder.
(p) The pro forma condensed financial statements and other
pro forma financial information (including the notes thereto) included
in the Final Memorandum (A) present fairly in all material respects
the information shown therein; (B) have
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been prepared in accordance with the applicable requirements of
Regulation S-X promulgated under the Act; (C) have been prepared in
accordance with the Commission's rules and guidelines with respect to
pro forma financial statements; and (D) have been properly computed on
the bases described therein. The assumptions used in the preparation
of the pro forma financial statements and other pro forma condensed
consolidated financial information included in the Final Memorandum
are reasonable and the adjustments used therein are reasonably
appropriate to give effect to the transactions or circumstances
referred to therein.
(q) Except as described in the Final Memorandum, there is
neither pending nor, to the knowledge of the Company, threatened any
action, suit, proceeding, inquiry or investigation involving the
Company or any of the Subsidiaries or to which any of their respective
properties is subject, before or brought by any court or governmental
agency or body (including, without limitation, the FCC) that would be
reasonably likely to have a material adverse effect on the business,
condition (financial or other) or results of operations of the Company
and the Subsidiaries, taken as a whole.
(r) Each of the Company and the Subsidiaries owns or
possesses adequate licenses or other rights to use all patents,
trademarks, service marks, trade names, copyrights and know-how
necessary to conduct the businesses operated by it, and on the Closing
Date will possess such licenses, rights and know-how necessary to
conduct the businesses proposed to be operated by it, as described in
the Final Memorandum, and none of the Company or any Subsidiary has
received any notice of infringement of, or conflict with (or knows of
any such infringement of or conflict with), asserted rights of others
with respect to any patents, trademarks, service marks, trade names,
copyrights or know-how that, if such assertion of infringement or
conflict were sustained, would have a material adverse effect on the
business, condition (financial or other) or results of operations of
the Company and the Subsidiaries, taken as a whole.
(s) Each of the Company and the Subsidiaries has obtained,
or has applied for, all licenses, permits, franchises and other
governmental authorizations necessary to conduct its businesses as
described in the Final Memorandum, the lack of which would have a
material adverse effect on the business, condition (financial or
other) or results of operations of the Company and the Subsidiaries,
taken as a whole.
(t) Subsequent to the respective dates as of which
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information is given in the Final Memorandum and except as described
therein or contemplated thereby, (i) none of the Company or any
Subsidiary has incurred any material liabilities or obligations,
direct or contingent, or entered into any material transactions, not
in the ordinary course of business; and (ii) the Company has not
purchased any of its outstanding capital stock or declared, paid or
otherwise made any dividend or distribution of any kind on its capital
stock.
(u) There are no legal or governmental proceedings that
would be required to be described in a prospectus pursuant to the Act
that are not described in the Final Memorandum, nor are there any
contracts or other documents that would be required to be described in
a prospectus pursuant to the Act that have not been described in the
Final Memorandum. Except as described in the Final Memorandum,
neither the Company nor any Subsidiary is in default under any
material contract, has received a notice or claim of any such default
or has knowledge of any breach of any such contract by the other party
or parties thereto, except such defaults or breaches as would not,
individually or in the aggregate, have a material adverse effect on
the business, condition (financial or other) or results of operations
of the Company and the Subsidiaries, taken as a whole, or on the
validity or enforceability of the Securities, as the case may be.
(v) Each of the Company and the Subsidiaries has filed all
necessary federal, state, local and foreign income and franchise tax
returns, except where the failure to so file such returns would not
have a material adverse effect on the business, condition (financial
or other) or results of operations of the Company and the
Subsidiaries, taken as a whole, and each of the Company and the
Subsidiaries has paid all taxes shown as due thereon; and other than
tax deficiencies that the Company or any Subsidiary is contesting in
good faith and for which adequate reserves have been provided, there
is no tax deficiency that has been asserted against the Company or any
Subsidiary that would, individually or in the aggregate, have a
material adverse effect on the business, condition (financial or
other) or results of operations of the Company and the Subsidiaries,
taken as a whole.
(w) Neither the Company nor any agent acting on its behalf
has taken or will take any action that might cause this Agreement or
the issuance and sale of the Securities to violate Regulation G, T, U
or X of the Board of Governors of the Federal Reserve System, in each
case as in effect on the Closing Date.
(x) Each of the Company and the Subsidiaries has good
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and marketable title to all real property and good title to all
personal property described in the Final Memorandum as being owned by
it and good and marketable title to all leasehold estates in the real
and personal property described in the Final Memorandum as being
leased by it (except for those leases of real property in which the
Company or any Subsidiary has good title and that would be marketable
but for the requirement that the landlord consent to an assignment or
sublease of the lease), free and clear of all liens, charges,
encumbrances or restrictions, except, in each case, as described in
the Final Memorandum or to the extent the failure to have such title
or the existence of such liens, charges, encumbrances or restrictions
would not, individually or in the aggregate, have a material adverse
effect on the business, condition (financial or other) or results of
operations of the Company and the Subsidiaries, taken as a whole.
(y) The Company is in compliance with all provisions of
Section 517.075 of Florida Statutes, as amended, relating to issuers
doing business with Cuba.
(z) The Company is not an "investment company," as defined
in the Investment Company Act of 1940, as amended, and the rules and
regulations thereunder.
(aa) Neither the Company nor any of its directors, officers
or controlling persons has taken, directly or indirectly, any action
designed, or that might reasonably be expected, to cause or result,
under the Act or otherwise, in, or that has constituted, stabilization
or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
(ab) None of the Company, any Subsidiary or any of their
respective Affiliates (as defined in Rule 501(b) of Regulation D under
the Act) has directly, or through any agent, (i) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of,
any "security" (as defined in the Act) which is or could be integrated
with the sale of the Securities in a manner that would require the
registration under the Act of the Securities or (ii) engaged in any
form of general solicitation or general advertising (as those terms
are used in Regulation D under the Act) in connection with the
offering of the Securities or in any manner involving a public
offering within the meaning of Section 4(2) of the Act. Assuming the
accuracy of the representations and warranties of the Initial
Purchasers in Section 8 hereof, it is not necessary in connection with
the offer, sale and delivery of the Securities to the
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Initial Purchasers in the manner contemplated by this Agreement to
register any of the Securities under the Act or to qualify the
Indenture under the TIA.
(ac) No securities of the Company or any Subsidiary are of
the same class (within the meaning of Rule 144A under the Act) as the
Shares and listed on a national securities exchange registered under
Section 6 of the Exchange Act, or quoted in a U.S. automated inter-
dealer quotation system.
(ad) Chancellor Radio Broadcasting has all requisite
corporate power and authority to consummate the Colfax Acquisition and
the New Credit Agreement. No consent, approval, authorization or
order of any court or governmental agency or body (including, without
limitation, the Federal Communications Commission (the "FCC")) is
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required for the performance of the Colfax Acquisition and the New
Credit Agreement by Chancellor Radio Broadcasting or the consummation
by Chancellor Radio Broadcasting of the transactions contemplated
thereby. In addition, no consent, approval, authorization or order of
any court or governmental agency or body (except for such consents,
approvals or authorizations as are required by the FCC or under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976) is required for
the performance by Chancellor Radio Broadcasting of the transactions
contemplated by the Pending Agreements and the Company has no
reasonable basis to believe that the transactions contemplated by the
Pending Agreements will not be consummated in accordance with their
terms.
3. Purchase, Sale and Delivery of the Securities.
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(a) On the basis of the representations, warranties,
agreements and covenants herein contained herein and subject to the
terms and conditions herein set forth herein, the Company agrees to
issue and sell to each of the Initial Purchasers, and each of the
Initial Purchasers severally agrees to purchase from the Company, at a
price of $48.25 per share, the number of Shares set forth opposite
their respective names on Schedule A hereto. The obligations of the
Initial Purchasers under this Agreement are several and not joint.
(b) Upon the basis of the representations, warranties,
agreements and covenants contained herein and subject to all the terms
and conditions set forth herein, the Company also agrees to sell to
the Initial Purchasers, and the Initial Purchasers shall have the
right to purchase from the Company, solely for the purpose of covering
over-allotments in connection with sales of the Firm Shares, at the
purchase price per share, pursuant to an
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option (the "over-allotment option") which may be exercised at any
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time and from time to time prior to 5:00 P.M., New York City time, on
the 30th day after the date of the Final Memorandum (or, if such 30th
day shall be a Saturday or Sunday or a holiday, on the next business
day thereafter when the Nasdaq National Market is open for trading),
up to an aggregate of 300,000 Additional Shares. Upon the exercise of
the over-allotment option, each Initial Purchaser, severally and not
jointly, agrees to purchase from the Company the number of Additional
Shares (subject to such adjustments as you may determine in order to
avoid fractional shares) that bears the same proportion to the
aggregate number of Additional Shares to be sold by the Company upon
such exercise of the over-allotment option as the number of Firm
Shares set forth opposite the name of such Initial Purchaser in
Schedule I hereto bears to the aggregate number of Firm Shares.
Delivery of and payment for the Firm Shares shall be made at
the offices of Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx on or about 9:00 A.M., New York City time, on January 23, 1997
(the Company having requested, and the Initial Purchasers having
agreed to such date in order for certain conditions to the Initial
Purchasers' obligations to be able to be satisfied) or at such other
place, time or date as the Initial Purchasers and the Company may
agree upon, such time and date of delivery against payment being
herein referred to as the "Closing Date." Delivery to the Initial
------------
Purchasers of and payment for any Additional Shares to be purchased by
the Initial Purchasers shall be made at the aforementioned office of
Xxxxxx Xxxxxx & Xxxxxxx at such time on such date (the "Option Closing
--------------
Date"), which may be the same as the Closing Date but shall in no
----
event be earlier than the Closing Date nor earlier than two nor later
than ten business days after the giving of the notice hereinafter
referred to, as shall be specified in a written notice from you on
behalf of the Initial Purchasers to the Company of the Initial
Purchasers' determination to purchase a number, specified in such
notice, of Additional Shares. The place of closing for any Additional
Shares and the Option Closing Date for such Shares may be varied by
agreement between you and the Company. One or more certificates in
definitive form for the Firm Shares and any Additional Shares that the
Initial Purchasers have agreed to purchase hereunder, and in such
denomination or denominations and registered in such name or names as
each Initial Purchaser requests upon notice to the Company at least 48
hours prior to the Closing Date or any Option Closing Date, shall be
delivered by or on behalf of the Company to the Initial Purchasers,
against payment by or on behalf of the Initial Purchasers of the pur-
chase price therefor, by wire transfer payable to or upon the order of
--
the Company in immediately available funds. The Company will make
such certificate or certificates for the Firm Shares and any
Additional Shares available for checking and packaging by the Initial
Purchasers at the offices in New York, New York of BT Securities
Corporation at least 24 hours prior to the Closing Date or the Option
Closing Date.
4. Offering by the Initial Purchasers. The Initial
----------------------------------
Purchasers propose to make an offering of the Securities at the price
and upon the terms set forth in the Final Memorandum, as soon as
practicable after this Agreement is entered into and as in the
judgment of the Initial Purchasers is advisable.
5. Covenants of the Company. The Company covenants and
------------------------
agrees with the Initial Purchasers that:
(a) The Company will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not previously have been advised and furnished a copy
for a reasonable period of time, prior to the proposed amendment or
supplement and as to which the Initial Purchasers shall not have given
their consent. The Company will promptly, upon the reasonable request
of the Initial Purchasers or counsel for the Initial Purchasers, make
any amendments or supplements to the Preliminary Memorandum or the
Final Memorandum that may be necessary or advisable in connection with
the resale of the Securities by the Initial Purchasers.
(b) The Company will cooperate with the Initial Purchasers
in arranging for the qualification of the Securities for offering and
sale under the securities or "Blue Sky" laws of such jurisdictions as
the Initial Purchasers may designate and will continue such
qualifications in effect for as long as may be necessary to complete
the resale of the Securities by the Initial Purchasers; provided,
--------
however, that in connection therewith the Company shall be required
-------
to qualify as a foreign corporation or to execute a general consent to
service of process in any jurisdiction.
(c) If, at any time prior to the completion of the
distribution by the Initial Purchasers of the Shares, any event occurs
as a result of which the Final Memorandum as then amended or
supplemented would include an untrue statement of a material fact, or
omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, or if for any other reason it is necessary at any time
to amend or supplement the Final Memorandum
--
in order to comply with applicable law, the Company will promptly
notify the Initial Purchasers thereof and will prepare, at the
Company's expense, an amendment to the Final Memorandum that corrects
such statement or omission or effects such compliance.
(d) The Company will, without charge, provide to the
Initial Purchasers and to counsel for the Initial Purchasers, as many
copies of the Preliminary Memorandum and the Final Memorandum or any
amendment or supplement thereto as the Initial Purchasers may
reasonably request.
(e) The Company will apply the net proceeds from the sale
of the Securities substantially as set forth under "Use of Proceeds"
in the Final Memorandum.
(f) For and during the five-year period ending on the fifth
anniversary of this Agreement, the Company will furnish to the Initial
Purchasers copies of all reports and other communications (financial
or otherwise) furnished by the Company to the Trustee or the holders
of the Securities and, as soon as available, copies of any reports or
financial statements furnished to or filed by the Company with the
Commission or any national securities exchange on which any class of
securities of the Company may be listed.
(g) Prior to the Closing Date, the Company will furnish to
the Initial Purchasers, as soon as they have been prepared by or are
available to the Company, a copy of any unaudited interim consolidated
financial statements of the Company for any period subsequent to the
period covered by its most recent financial statements appearing in
the Final Memorandum.
(h) None of the Company or any of its Affiliates will sell,
offer for sale or solicit offers to buy or otherwise negotiate in
respect of any "security" (as defined in the Act) which could be
integrated with the sale of the Securities in a manner which would
require the registration under the Act of the Securities.
(i) Except in connection with the Registration Rights
Agreement, the Company will not, and will not permit any of the
Subsidiaries to, engage in any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) in
connection with the offering of the Securities or in any manner
involving a public offering within the meaning of Section 4(2) of the
Act.
--
(j) For so long as any of the Shares remain outstanding,
the Company will make available at its expense, upon request, to any
holder of such Shares and any prospective purchasers thereof the
information specified in Rule 144A(d)(4) under the Act, unless the
Company is then subject to Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended.
(k) The Company will use its best efforts to (i) permit the
Shares to be designated PORTAL securities in accordance with the rules
and regulations adopted by the NASD relating to trading in the Private
Offerings, Resales and Trading through Automated Linkages market (the
"Portal Market"), (ii) permit the Shares to be eligible for clearance
-------------
and settlement through The Depository Trust Company and (iii) have the
shares of Common Stock issuable upon conversion of the Shares listed,
subject to official notice of issuance, on NASDAQ prior to or
concurrently with the Closing Date.
6. Expenses. The Company agrees to pay the following
--------
costs and expenses and all other costs and expenses incident to the
performance of its obligations under this Agreement, whether or not
the transactions contemplated herein are consummated or this Agreement
is terminated pursuant to Section 11 hereof: (i) the printing, word
processing or other production of documents with respect to such
transactions, including any costs of printing the Preliminary
Memorandum and the Final Memorandum and any amendments thereto, and
any "Blue Sky" memoranda, (ii) all arrangements relating to the
delivery to the Initial Purchasers of copies of the foregoing
documents, (iii) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Company,
(iv) the preparation (including printing), issuance and delivery to
the Initial Purchasers of any certificates evidencing the Shares,
including transfer agent's fees, (v) the qualification of the
Securities under state securities and "Blue Sky" laws, including
filing fees and reasonable fees and disbursements of counsel for the
Initial Purchasers relating thereto and (vi) the expenses of the
Company in connection with any meetings with prospective investors in
the Securities. If the issuance and sale of the Securities provided
for herein is not consummated because any condition to the obligations
of the Initial Purchasers set forth in Section 7 hereof is not
satisfied, because this Agreement is terminated pursuant to Section 11
hereof or because of any failure, refusal or inability on the part of
the Company to perform all obligations and satisfy all conditions on
its part to be performed or satisfied hereunder other than by reason
of a default by the Initial Purchasers, the Company will reimburse the
--
Initial Purchasers upon demand for all reasonable out-of-pocket
expenses (including reasonable counsel fees and disbursements) that
shall have been incurred by the Initial Purchasers in connection with
the proposed purchase and sale of the Securities.
7. Conditions of the Initial Purchasers' Obligations. The
-------------------------------------------------
obligations of the Initial Purchasers to purchase and pay for the
Securities shall, in their sole discretion, be subject to the
following conditions:
(a) The Initial Purchasers shall have received opinions in
form and substance satisfactory to the Initial Purchasers and counsel
for the Initial Purchasers, dated the Closing Date, of (i) Weil,
Gotshal & Xxxxxx LLP, counsel for the Company, substantially in the
form of Exhibit A-1 hereto and (ii) Xxxxxxxxx & Associates, regulatory
counsel for the Company, substantially in the form of Exhibit A-2
hereto.
(b) The Initial Purchasers shall have received an opinion,
dated the Closing Date, of Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Initial Purchasers, with respect to certain legal matters relating to
this Agreement, and such other related matters as the Initial
Purchasers may require. In rendering such opinion, Xxxxxx Xxxxxx &
Xxxxxxx shall have received and may rely upon such certificates and
other documents and information as they may reasonably request to pass
upon such matters. In addition, in rendering their opinion, Xxxxxx
Xxxxxx & Xxxxxxx may state that their opinion is limited to matters of
New York, Delaware corporate and federal law.
(c) The Initial Purchasers shall have received from each of
Coopers & Xxxxxxx L.L.P., independent public accountants for the
Company, and Xxxxxx Xxxxxxxx LLP, independent public accountants for
Colfax, letters dated, respectively, the date hereof and the Closing
Date, in form and substance satisfactory to the Initial Purchasers and
counsel for the Initial Purchasers.
(d) The representations and warranties of the Company
contained in this Agreement shall be true and correct in all material
respects on and as of the Closing Date (other than to the extent any
such representation or warranty is expressly made as to a certain
date); the Company shall have performed, in all material respects, all
covenants and agreements and satisfied, in all material respects, all
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date; and subsequent to the date of the most
recent financial statements in the Final Memorandum, there shall have
been no material adverse
--
change in the business, condition (financial or other) or results of
operations of the Company and the Subsidiaries, taken as a whole,
except as set forth in, or contemplated by, the Final Memorandum.
(e) The issuance and sale of the Securities pursuant to
this Agreement shall not be enjoined (temporarily or permanently) and
no restraining order or other injunctive order shall have been issued
or any action, suit or proceeding shall have been commenced with
respect to this Agreement before any court or governmental authority
(including, without limitation, the FCC).
(f) Subsequent to the respective dates as of which
information is given in the Final Memorandum, except in each case as
described in or as contemplated by the Final Memorandum, the Company
and the Subsidiaries shall not have incurred any liabilities or
obligations, direct or contingent, that are material to the Company
and the Subsidiaries taken as a whole, or entered into any
transactions that are material to the business, condition (financial
or other) or results of operations of the Company and the
Subsidiaries taken as a whole, and there shall not have been any
change in the capital stock or long-term indebtedness of the Company
that is material to the business, condition (financial or other) or
results of operations of the Company and the Subsidiaries, taken as a
whole.
(g) The Initial Purchasers shall have received
certificates, dated the Closing Date, signed on behalf of the Company
by its President and Chief Executive Officer and Senior Vice President
and Chief Financial Officer to the effect that:
(i) The representations and warranties of the Company in
this Agreement are true and correct in all material respects as if
made on and as of the Closing Date (other than to the extent any such
representation or warranty is expressly made to a certain date), and
the Company has performed, in all material respects, all covenants and
agreements and satisfied, in all material respects, all conditions on
its part to be performed or satisfied hereunder at or prior to the
Closing Date;
(ii) Subsequent to the respective dates as of which
information is given in the Final Memorandum, there has not been any
material adverse change in the business, condition (financial or
other) or results of operations of the Company and the Subsidiaries,
taken as a whole;
--
(iii) Subsequent to the respective dates as of which
information is given in the Final Memorandum, except in each case as
described in or as contemplated by the Final Memorandum, none of the
Company or any Subsidiary has incurred any liabilities or obligations,
direct or contingent that are material to the Company or the
Subsidiaries taken as a whole, or entered into any transactions that
are material to the business, condition (financial or other) or
results of operations of the Company and the Subsidiaries, taken as a
whole, and there has been no change in the capital stock or long-term
indebtedness of the Company that is material to the business,
condition (financial or other) or results of operations of the Company
and the Subsidiaries taken as a whole; and
(iv) The issuance and sale of the Securities by the
Company has not been enjoined (temporarily or permanently).
(h) On the Closing Date, the Initial Purchasers shall
have received the Registration Rights Agreement executed by the
Company and such agreement shall be in full force and effect at all
times from and after the Closing Date.
(i) The closing under the New Credit Agreement and the
completion of the offering by Chancellor Radio Broadcasting of its
Exchangeable Preferred Stock shall have occurred concurrently with the
closing hereunder on the Closing Date.
(j) The Colfax Acquisition shall have been consummated
on or prior to the Closing Date.
(k) On or before the Closing Date, the Initial
Purchasers and counsel for the Initial Purchasers shall have received
such further documents, opinions, certificates and schedules or
instruments relating to the business, corporate, legal and financial
affairs of the Company as they shall have heretofore reasonably
requested from the Company.
All such documents, opinions, certificates and schedules
or instruments delivered pursuant to this Agreement will comply with
the provisions hereof only if they are reasonably satisfactory in all
material respects to the Initial Purchasers and counsel for the
Initial Purchasers. The Company shall furnish to the Initial
Purchasers such conformed copies of such documents, opinions,
certificates and schedules or instruments in such quantities as the
Initial Purchasers shall reasonably request.
--
8. Offering of Securities; Restrictions on Transfer.
------------------------------------------------
Each of the Initial Purchasers represents and warrants (as to itself
only) that it is a QIB. Each of the Initial Purchasers agrees with
the Company (as to itself only) that (i) it has not and will not
solicit offers for, or offer or sell, the Securities by any form of
general solicitation or general advertising (as those terms are used
in Regulation D under the Act) or in any manner involving a public
offering within the meaning of Section 4(2) of the Act; and (ii) it
has and will solicit offers for the Securities only from, and will
offer the Securities only to (A) in the case of offers inside the
United States, (x) persons whom the Initial Purchasers reasonably
believe to be QIBs or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or
agent, only when such person has represented to the Initial Purchasers
that each such account is a QIB, to whom notice has been given that
such sale or delivery is being made in reliance on Rule 144A, and, in
each case, in transactions under Rule 144A or (y) a limited number of
other institutional investors reasonably believed by the Initial
Purchasers to be accredited investors, as defined in Rule 501(a)(1),
(2), (3) or (7) promulgated under the Act that, prior to their
purchase of the Securities, deliver to the Initial Purchasers a letter
containing the representations and agreements set forth in Annex A to
the Final Memorandum and (B) in the case of offers outside the United
States, to persons other than U.S. persons ("foreign purchasers,"
------------------
which term shall include dealers or other professional fiduciaries in
the United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)); provided, however,
-------- -------
that, in the case of this clause (B), in purchasing such Securities
such persons are deemed to have represented and agreed as provided
under the caption "Transfer Restrictions" contained in the Final
Memorandum.
9. Indemnification and Contribution. (a) The Company
--------------------------------
agrees to indemnify and hold harmless each of you and each other
Initial Purchaser and each person, if any, who controls any Initial
Purchaser within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation)
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Memorandum
or the Final Memorandum or in any amendment or supplement thereto, or
arising out of or based upon any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except
--
insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged
untrue statement or omission which has been made therein or omitted
therefrom in reliance upon and in conformity with information relating
to any Initial Purchaser furnished in writing to the Company by or on
behalf of any Initial Purchaser expressly for use in connection
therewith; provided, however, that the indemnification contained in
-------- -------
this paragraph (a) with respect to the Preliminary Memorandum shall
not inure to the benefit of any Initial Purchaser (or to the benefit
of any person controlling such Initial Purchaser) on account of any
such loss, claim, damage, liability or expense arising from the sale
of the Shares by the Initial Purchaser to any person if the untrue
statement or alleged untrue statement or omission or alleged omission
of a material fact contained in such Preliminary Memorandum was
corrected in the Final Memorandum and such Initial Purchaser sold
Shares to that person without sending or giving at or prior to the
written confirmation of such sale, a copy of the Final Memorandum (as
then supplemented) if the Company has previously furnished sufficient
copies thereof to the several Initial Purchasers. The foregoing
indemnity agreement shall be in addition to any liability which the
Company may otherwise have.
(b) If any action, suit or proceeding shall be brought
against any Initial Purchaser or any person controlling any Initial
Purchaser in respect of which indemnity may be sought against the
Company, any such Initial Purchaser or any such controlling person
shall promptly notify the parties against whom indemnification is
being sought (the "indemnifying parties"), and such indemnifying
parties shall assume the defense thereof, including the employment of
counsel and payment of all fees and expenses. Such Initial Purchaser
or any such controlling person shall have the right to employ separate
counsel in any such action, suit or proceeding and to participate in
the defense thereof, but the fees and expenses of such counsel shall
be at the expense of such Initial Purchaser or such controlling person
unless (i) the indemnifying parties have agreed in writing to pay such
fees and expenses, (ii) the indemnifying parties have failed to assume
the defense and employ counsel, or (iii) the named parties to any such
action, suit or proceeding (including any impleaded parties) include
both such Initial Purchaser or such controlling person and the
indemnifying parties and such Initial Purchaser or such controlling
person shall have been advised by its counsel that representation of
such indemnified party and any indemnifying parties by the same
counsel would be inappropriate under applicable standards of
professional conduct (whether or
--
not such representation by the same counsel has been proposed) due to
actual or potential differing interests between them (in which case
the indemnifying parties shall not have the right to assume the
defense of such action, suit or proceeding on behalf of such Initial
Purchaser or such controlling person). It is understood, however,
that the indemnifying parties shall, in connection with any one such
action, suit or proceeding or separate but substantially similar or
related actions, suits or proceedings in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for
the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all such
Initial Purchasers and controlling persons not having actual or
potential differing interests with you or among themselves, which firm
shall be designated in writing by Xxxxx Xxxxxx Inc., and that all
such fees and expenses shall be reimbursed on a monthly basis. The
indemnifying parties shall not be liable for any settlement of any
such action, suit or proceeding effected without their written
consent, but if settled with such written consent, or if there be a
final judgment for the plaintiff in any such action, suit or
proceeding, the indemnifying parties agree to indemnify and hold
harmless any Initial Purchaser, to the extent provided in paragraph
(a) hereof, and any such controlling person from and against any loss,
claim, damage, liability or expense by reason of such settlement or
judgment.
(c) Each Initial Purchaser agrees, severally and not
jointly, to indemnify and hold harmless the Company, its directors,
its officers and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange act, to
the same extent as the foregoing indemnity from the Company to each
Initial Purchaser set forth in paragraph (a) hereof, but only with
respect to information relating to such Initial Purchaser furnished in
writing by or on behalf of such Initial Purchaser expressly for use in
the Preliminary Memorandum or Final Memorandum, or any supplement
thereto. If any action, suit or proceeding shall be brought against
the Company, any of its directors, any such officer, or any such
controlling person based on the Preliminary Memorandum or Final
Memorandum, or supplement thereto, and in respect of which indemnity
may be sought against any Initial Purchaser pursuant to this paragraph
(c), such Initial Purchaser shall have the rights and duties given to
the Company by paragraph (b) above (except that if the Company shall
have assumed the defense thereof such Initial Purchaser shall not be
required to do so, but may employ separate counsel therein and
participate in the defense thereof, but the fees and expenses of such
counsel shall be at such Initial
--
Purchaser's expense), and the Company, its directors, any such
officer, and any such controlling person, shall have the rights and
duties given to the Initial Purchasers by paragraph (b) above. The
foregoing indemnity agreement shall be in addition to any liability
which the Initial Purchasers may otherwise have.
(d) If the indemnification provided for in this Section
9 is unenforceable although available by its terms to an indemnified
party under paragraphs (a) or (c) hereof in respect of any losses,
claims, damages, liabilities or expenses referred to therein, then an
indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities or
expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the
Initial Purchasers on the other hand from the offering of the Shares,
or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Company on the one hand and the
Initial Purchasers on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the
one hand and the Initial Purchasers on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company bear to the total
discounts and commissions received by the Initial Purchasers, in each
case as set forth in the table on the cover page of the Final
Memorandum; provided that, in the event that the Initial Purchasers
--------
shall have purchased any Additional Shares hereunder, any
determination of the relative benefits received by the Company and the
Initial Purchasers from the offering of the Shares shall include the
net proceeds (before deducting expenses) received by the Company and
the discounts and commissions received by the Initial Purchasers from
the sale of such Additional Shares, in each case computed on the basis
of the respective amounts set forth in the notes to the table on the
cover page of the Final Memorandum. The relative fault of the Company
on the one hand and the Initial Purchasers on the other hand shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by
the Company on the one hand or by the Initial Purchasers on the other
hand and the parties' relative intent, knowledge, access to
information
--
and opportunity to correct or prevent such statement or omission.
(e) The Company and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this
Section 9 were determined by a pro rata allocation (even if the
Initial Purchasers were treated as one entity for such purpose) or by
any other method of allocation that does not take account of the
equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities and expenses referred to in
paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating
any claim or defending any such action, suit or proceeding.
Notwithstanding the provisions of this Section 9, no Initial Purchaser
shall be required to contribute any amount in excess of the amount by
which the total price of the Shares purchased by it and sold to
Eligible Purchasers exceeds the amount of any damages which such
Initial Purchaser has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
The Initial Purchasers' obligations to contribute pursuant to this
Section 9 are several in proportion to the respective numbers of Firm
Shares set forth opposite their names in Schedule I hereto and not
joint.
(f) No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any
pending or threatened action, suit or proceeding in respect of which
any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses
for which an indemnified party is entitled to indemnification or
contribution under this Section 9 shall be paid by the indemnifying
party to the indemnified party on a monthly basis. The indemnity and
contribution agreements contained in this Section 9 and the
representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect,
regardless of
--
(i) any investigation made by or on behalf of any Initial Purchaser or
any person controlling any Initial Purchaser, the Company, its
directors or officers or any person controlling the Company,
(ii) acceptance of any Shares and payment therefor hereunder, and
(iii) any termination of this Agreement. A successor to any Initial
Purchaser or any person controlling any Initial Purchaser, or to the
Company, its directors or officers, or any person controlling the
Company, shall be entitled to the benefits of the indemnity,
contribution and reimbursement agreements contained in this Section 9.
10. Survival Clause. The respective representations,
---------------
warranties, agreements, covenants, indemnities and other statements of
the Company, its officers and the Initial Purchasers set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement shall remain in full force and effect, regardless of
(i) any investigation made by or on behalf of the Company, any of its
officers or directors, the Initial Purchasers or any controlling
person referred to in Section 9(a) hereof and (ii) delivery of and
payment for the Securities. The respective agreements, covenants,
indemnities and other statements set forth in Sections 6 and 9 hereof
shall remain in full force and effect, regardless of any termination
or cancellation of this Agreement.
11. Termination. (a)This Agreement may be terminated in
-----------
the sole discretion of the Initial Purchasers by notice to the Company
given prior to the Closing Date in the event that the Company shall
have failed, refused or been unable to perform, in all material
respects, all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder at or prior thereto or, if at or
prior to the Closing Date:
(i) trading in securities generally on the New York
Stock Exchange, the American Stock Exchange or the Nasdaq National
Market shall have been suspended or materially limited;
(ii) a general moratorium on commercial banking
activities in New York shall have been declared by either federal,
state or other governmental authorities;
(iii) there shall have occurred any outbreak or escalation
of hostilities or other international or domestic calamity, crisis or
change in political, financial or economic conditions, the effect of
which on the financial markets of the United States is such as to make
it, in the judgment of the Initial Purchasers, impracticable or
inadvisable to commence or
--
continue the offering of the Securities as contemplated by the Final
Memorandum, as amended as of the date hereof; or
(iv) any securities of the Company shall have been
downgraded or placed on any "watch list" for possible downgrading by
any nationally recognized statistical rating organization.
(b) Termination of this Agreement pursuant to this
Section 11 shall be without liability of any party to any other party
except as provided in Section 10 hereof.
12. Notices. All communications hereunder shall be in
-------
writing and, if sent to the Initial Purchasers, shall be mailed or
delivered or telecopied and confirmed in writing to Xxxxx Xxxxxx Inc.,
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate
Finance Department; if sent to the Company, shall be mailed or
delivered or telecopied and confirmed in writing to the Company at
00000 Xxxxx Xxxxxxx Xxxxxxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000,
Attention: Xxxxxxx Xxxxxxx.
13. Successors. This Agreement shall inure to the
----------
benefit of and be binding upon the Initial Purchasers and the Company
and their respective successors and legal representatives, and nothing
expressed or mentioned in this Agreement is intended or shall be
construed to give any other person any legal or equitable right,
remedy or claim under or in respect of this Agreement, or any
provisions herein contained; this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and
exclusive benefit of such persons and for the benefit of no other
person except that (i) the indemnities of the Company contained in
Section 9 of this Agreement shall also be for the benefit of any
person or persons who control the Initial Purchasers within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act and
(ii) the indemnities of the Initial Purchasers contained in Section 9
of this Agreement shall also be for the benefit of the directors of
the Company, its officers and any person or persons who control the
Company within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act. No purchaser of Securities from the Initial
Purchasers will be deemed a successor because of such purchase.
14. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF
--------------
THIS AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, WITHOUT GIVING EFFECT TO ANY PROVISIONS RELATING TO
CONFLICTS OF LAW.
15. Counterparts. This Agreement may be executed in two
------------
or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
16. Default of Initial Purchasers. If any Initial
-----------------------------
Purchaser defaults in its obligations to purchase Securities hereunder
and arrangements satisfactory to the non-defaulting Initial Purchasers
and the Company for the purchase of such Securities by other persons
are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of the non-defaulting Initial
Purchaser or the Company, except as provided in Sections 5 and 6. As
used in this Agreement, the term "Initial Purchaser" includes any
person substituted for an Initial Purchaser under this Section.
Nothing herein will relieve a defaulting Initial Purchaser from
liability for its default.
If the foregoing correctly sets forth our understanding,
please indicate your acceptance thereof in the space provided below
for that purpose, whereupon this letter shall constitute a binding
agreement among the Company and the Initial Purchasers.
Very truly yours,
CHANCELLOR BROADCASTING COMPANY
By: /s/ XXXXXX XXXXXX
---------------------------------------
Name: Xxxxxx Xxxxxx
Title: President and Chief Executive
Office
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
XXXXX XXXXXX INC.
/s/ AUTHORIZED SIGNATORY OF
By: XXXXX XXXXXX INC.
-----------------------------------
ALEX. XXXXX & SONS INCORPORATED
/s/ AUTHORIZED SIGNATORY OF
By: ALEX. XXXXX & SONS INCORPORATED
-----------------------------------
BT SECURITIES CORPORATION
/s/ AUTHORIZED SIGNATORY OF
By: BT SECURITIES CORPORATION
-----------------------------------
CREDIT SUISSE FIRST BOSTON CORPORATION
/s/ AUTHORIZED SIGNATORY OF
By: CREDIT SUISSE FIRST BOSTON CORPORATION
-----------------------------------------
XXXXXXX, SACHS & CO.
/s/ AUTHORIZED SIGNATORY OF
By: XXXXXXX, XXXXX & CO.
-----------------------------------
SCHEDULE A
Underwriter Number of Shares
----------- ----------------
Xxxxx Xxxxxx Inc. . . . . . . . . . . . . 800,000
Alex. Xxxxx & Sons Incorporated . . . . . 300,000
BT Securities Corporation . . . . . . . . 300,000
Credit Suisse First Boston
Corporation . . . . . . . . . . . . . . 300,000
Xxxxxxx, Sachs & Co. . . . . . . . . . . . 300,000
_________
Total . . . . . . . . . . . . . . . . 2,000,000
=========
SCHEDULE B
Subsidiaries of Chancellor Broadcasting Company
Chancellor Radio Broadcasting Company
Chancellor Broadcasting Licensee Company
Trefoil Communications, Inc.
Shamrock Broadcasting Inc.
Shamrock Radio Licenses, Inc.
Shamrock Broadcasting Licenses of Denver, Inc.
Shamrock Broadcasting of Texas, Inc.
